Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
And? Seriously, I'm hardly suggesting that a massive infrastructure rebuilding program would be the solution to our economic problems. However, it sure wouldn't hurt. Geez, this is what we've been doing under the guise of various and sundry ongoing wars. What? $19 TRILLION is the 'Keynesian' debt that we run up. Cripes, I'd rather rebuild the infrastructure. Rebuilding infrastructure is also investing in the future and if we're going to deficit spend . . .
What they have been doing is funneling all the QE to the high end of the income chain where it sits today. Trickle down economics?!? Oh really.
My point is and remains that we need to seriously focus on some demand side economics .
and so it goes,
peace,
rono
Not a solution, and wouldn't hurt. Wow really going out on a limb with that one.
When has that 'demand side' economics worked in the past?
FYI you may actually have to make a definitive statement to answer that question.
And take into account "When infrastructure was being built in the '30s it was a labor intensive project in a closed economic (non free trade, non international) system. That is not the case today at all. Before the stimulus package was voted upon, some one had the bold ideas to make it a requirement that the $ had to go to US companies - China and other countries shot that down. " And you may want to take into consideration the velocity of money in why 'demand side' is an old idea that doesn't work.
And you may want to take into consideration the velocity of money in why 'demand side' is an old idea that doesn't work.
I am curious. Would you explain what you mean by the above? Not a googled link please. Your insights that led you to make that statement. What do you think happens to velocity of money in demand side stimulus and what it implies about the effectiveness of the stimulus.
And you may want to take into consideration the velocity of money in why 'demand side' is an old idea that doesn't work.
I am curious. Would you explain what you mean by the above? Not a googled link please. Your insights that led you to make that statement. What do you think happens to velocity of money in demand side stimulus and what it implies about the effectiveness of the stimulus.
Thanks.
You have to take it together with: "Before the stimulus package was voted upon, some one had the bold ideas to make it a requirement that the $ had to go to US companies - China and other countries shot that down. " and "When infrastructure was being built in the '30s it was a labor intensive project in a closed economic (non free trade, non international) system. That is not the case today at all. "
In the past - the closed system - $1 of gov't spending on 'demand economics' i.e. public works, stayed in the country and would flow through the US economy several times e.g. 7-8 times - e.g. spend $1 trillion dollars and 7 trillion of 'demand' is created over time.
Now a percentage of that initial $1 goes out of the country and a percentage of the velocity of money also goes outside the USA.
E.g. spend $1trillion - 500m goes to China. 500m flows in USA but those people buy Chinese goods. It look like this in the USA if you assume velocity is 7 500 m 400 300 200 100 75 50 1,625 T
This is another reason why K theory doesn't work in today's world.
Also, since foreigners own the USA debt - the interest on the debt on the initial $1T is flowing outside the USA and can't even be taxed.
Another reason why K theory doesn't work in today's world.
But, K theory is a favorite of the pseudo intellectuals who don't understand economics.
@dex Here I was thinking you are a robot that had replaced a forum poster as you envision with a built-in search engine and a collapsism view that is the easiest to program in as all one has to do is one liners, throw stones and insults and deny the existence of any solution which are all self-serving to that view. Perhaps you still are. Should continue with the Turing Test.
I agree to a certain extent with the stimulus leakage from globalization more so than Krugmans of this world will admit to. As it turns out my only letter ever published by the Economist has been to point out the folly of their globalization at all costs (they are the biggest cheerleaders) when capital flow has no borders but labor flow does.
The idea of targeting spending only to US companies is not practical because it is very difficult to isolate US only companies. Money is fungible, so companies can take the money for domestic work and move the equivalent to foreign operations directly or via subsidiaries. Spending will always result in too many pork barrel projects so not a good idea. On the other hand broad and blanket untargeted tax cuts only concentrates wealth without sufficient stimulation.
But that is the structure we have got and it is not going to change any time soon. So where I differ from you is to reject collapsism/fatalism because in my line of work naysayers are the ones that create opportunities and wealth in the start up world every day (because they all land up in middle management of large companies and bring the companies down to a crawling halt saying nothing can be done which lets the can-do startups come out with solutions to disrupt the big guys). But it is not as easy to disrupt the political ideologies and needs a little bit of generational change to get rid of the hubris that has built up in our political system.
There are a large number of proposals within the CEO forums, advisory councils to the politicians, etc with much more out of the box thinking than the current cut taxes vs spend money debate. Ironically, most politicians on either side are smart enough to recognize that and in private willing to admit that it is not something that they can sell to their base in the current climate or say that they cannot support it when the other team is in power but will be willing to look at when they get the power/majority, etc. So the proposals remain as proposals in private communications and presentations for now.
One proposal out there that I am inclined towards which recognizes creating higher paid domestic job is the key (which everyone agrees to), is a tax based incentivization to do so. Nothing radical and something that already exists. For example, states compete with each other to steal businesses away from each other via large tax incentives. The proposal is based on the same idea but doing so from other countries, a sort of reverse-Irish so to speak. The tax incentive is tied tightly to domestic employment creation, so the revenue that passes through to employees isn't taxed at all at the corporation level but also provides tax credits but is recovered by the Govt as higher income taxes (relative to corporate taxe credits provided).
Foreign revenues can also be repatriated tax free as long as they can be offset via tax credits for domestic employment. This is available to US companies as well so there is no favor to any country or company. These can be anything from infrastructure companies to high tech to private education. The idea is to make the tax treatment address the imbalance in pay between countries (not entirely but sufficiently to make it worthwhile) while companies benefit from exposure to domestic market and the stability of the country and currency. Import tariffs may not be required at all to further incentivize.
Car companies have already done this to locate plants in the US based on state and municipal incentives. But needs to be incorporated into a national policy.
This is an idea that is not strange to right wing politicians and makes much sense to them BUT the US chamber of Commerce and the finanacial industry lobbying will not support it because they want corporate taxes cut for everybody whether they create employment or not or outsource it because they are only looking at return on capital not whether something is good or bad for the country in the long run. And the hypocrisy of many of their member industries does not allow for foreign companies to come and compete at least not facilitated by the US Govt if they can help it. Right wing politicians simply do not have the courage to fight that in the current climate.
The proposal is also received well in left wing political groups as it helps labor but resisted strongly by the lobbies that benefit from domestic spending and I suspect Krugman would be screaming his head off because it doesn't do the level of spending he wants. The many groups that want direct handouts will make the narrative look bad - Govt giving tax breaks to foreign governments while the poor in this country are ignored, etc. It will be cast as another failed trickle down policy. The left does not have the courage to take that on.
Both parties are afraid of the optics of bringing foreign companies to the US with tax incentives as a national policy even though it seems perfectly acceptable at the state or municipal levels.
It is a bit more complicated than the above in terms of incentives in land and tax deferrals for a limited time to set up the company but that is the gist of it. It requires, I think, a generational change in politics with the millenial generation getting into politics who are less xenophobic culturally and have grown up with a deep suspicion of the financial industry and the power of lobbies to change. So, I don't expect any miracles overnight.
As much as millenials are scorned by the older generation, I am encouraged by the optimistic and can do attitudes that I see in so many of them.
We will just have to see how it evolves. Like the financial markets it is difficult to predict the future but good things do happen longer term. Human beings are wired for adaptation and survival when faced with challenges and the US more than any other country encourages that.
The idea of targeting spending only to US companies is not practical because it is very difficult to isolate US only companies.
My point was not if it was possible, but that it could not be done/allowed.
But that is the structure we have got and it is not going to change any time soon. So where I differ from you is to reject collapsism/fatalism because in my line of work naysayers are the ones that create opportunities and wealth in the start up world every day (because they all land up in middle management of large companies and bring the companies down to a crawling halt saying nothing can be done which lets the can-do startups come out with solutions to disrupt the big guys). But it is not as easy to disrupt the political ideologies and needs a little bit of generational change to get rid of the hubris that has built up in our political system.
I think we differ in that I see things as they are not as I wish them to be ... i.e. I don't see people's ideas as 'naysayers' or optimistic.
One proposal out there that I am inclined towards which recognizes creating higher paid domestic job is the key (which everyone agrees to), is a tax based incentivization to do so. Nothing radical and something that already exists. For example, states compete with each other to steal businesses away from each other via large tax incentives. The proposal is based on the same idea but doing so from other countries, a sort of reverse-Irish so to speak. The tax incentive is tied tightly to domestic employment creation, so the revenue that passes through to employees isn't taxed at all at the corporation level but also provides tax credits but is recovered by the Govt as higher income taxes (relative to corporate taxe credits provided).
You can not force that. In the future the only secure job will be the one that can not be replaced by a robot, AI or off shored.
Foreign revenues can also be repatriated tax free as long as they can be offset via tax credits for domestic employment. This is available to US companies as well so there is no favor to any country or company. These can be anything from infrastructure companies to high tech to private education. The idea is to make the tax treatment address the imbalance in pay between countries (not entirely but sufficiently to make it worthwhile) while companies benefit from exposure to domestic market and the stability of the country and currency. Import tariffs may not be required at all to further incentivize.
Car companies have already done this to locate plants in the US based on state and municipal incentives. But needs to be incorporated into a national policy.
This is an idea that is not strange to right wing politicians and makes much sense to them BUT the US chamber of Commerce and the finanacial industry lobbying will not support it because they want corporate taxes cut for everybody whether they create employment or not or outsource it because they are only looking at return on capital not whether something is good or bad for the country in the long run. And the hypocrisy of many of their member industries does not allow for foreign companies to come and compete at least not facilitated by the US Govt if they can help it. Right wing politicians simply do not have the courage to fight that in the current climate.
The proposal is also received well in left wing political groups as it helps labor but resisted strongly by the lobbies that benefit from domestic spending and I suspect Krugman would be screaming his head off because it doesn't do the level of spending he wants. The many groups that want direct handouts will make the narrative look bad - Govt giving tax breaks to foreign governments while the poor in this country are ignored, etc. It will be cast as another failed trickle down policy. The left does not have the courage to take that on.
Both parties are afraid of the optics of bringing foreign companies to the US with tax incentives as a national policy even though it seems perfectly acceptable at the state or municipal levels.
It is a bit more complicated than the above in terms of incentives in land and tax deferrals for a limited time to set up the company but that is the gist of it. It requires, I think, a generational change in politics with the millenial generation getting into politics who are less xenophobic culturally and have grown up with a deep suspicion of the financial industry and the power of lobbies to change. So, I don't expect any miracles overnight.
Tax polices are looked at as a vehicle for social change. Until it is looked upon as just a revenue; it will stay the same.
As much as millenials are scorned by the older generation, I am encouraged by the optimistic and can do attitudes that I see in so many of them.
I don't see any scorn for them and I think what you see as 'can do' I see as pragmatic - in line with my way of thinking. Also, they are not in a place or have the number to institute change. So, they are a non factor, except in their own circle of life.
We will just have to see how it evolves. Like the financial markets it is difficult to predict the future but good things do happen longer term. Human beings are wired for adaptation and survival when faced with challenges and the US more than any other country encourages that.
The idea of targeting spending only to US companies is not practical because it is very difficult to isolate US only companies.
My point was not if it was possible, but that it could not be done/allowed.
Turing Test fail. Any human would have understood the point being made that it might not have been allowed/done because that criterion is too ill-defined to be practically implemented for reasons stated.
Goes to show less/more isn't correlated with clarity. Which points to the false dichotomy (google this fallacy) in the last paragraph.
But then self-professed clarity is usually a confirming sign of self-reinforcing delusion, a condition that I am totally unprepared to have a discourse with and so would be at a serious disadvantage. Hence I must excuse myself from this thread for more productive use of my time.
Thank you for your time with this most complex area of our social structure; and your common sense expressions and considerations regarding various circumstances. Too many conflicting fingers in the money pie as the money attempts to do good in the right places for the right reasons. Example: I'm just waiting for the tv news flash when we see that another interstate highway bridge has crumbled apart and fallen; but this time, taking some high level government folks for the deadly ride. Stuff that needs fixing will start to get fixed then, eh? Our dear central government has become too large for its own good. 'Course, as you well know too; that too many things do not become properly resolved at the small local levels either. All and all, quite frustrating more often than should be the case. Take care of you and yours,
Catch
Howdy catch,
Good to hear from you. Can we get Obama to appoint an Emergency Governor of Michigan?
I'm so outraged, it's hard to think. Snyder's talking about the buck stops with him while throwing civil servants under the bus. AG is refusing to represent a few of the DEQ folks as a possible conflict because he must represent both the Gov and the state.
Issue with the suit is Gross Negligence. State and local gov'ts are exempt from suit UNLESS gross negligence has occurred. I don't trust the AG (religinazi creep) but I'm actually starting to trust the SCOM.
Howdy there. FYI, I've flagged Dex's comments a couple of times recently as being juvenile, boorish, and unnecessarily personally argumentative. Of course on a public forum, especially one as lightly moderated as MFO, it's not uncommon to attract the occasional troll. Usually they are so obnoxious that the moderators eventually discourage their continued participation in the forum.
Dex, however, is a unique and difficult case because he is quite capable of originating reasonable and interesting topics. Unfortunately, he automatically reverts to his juvenile attack mode whenever anyone dares to disagree with him in the slightest manner, which makes continued conversation impossible. After a number of exchanges with him I realized that I was being dragged down to his schoolyard level, so I've resolved just to simply ignore him. There's no sense in continuing to feed his obvious insatiable need for applause and approbation.
Geez, you peeps that live in The City, are soooooo sensitive. teehehe
Yeah, I noticed it too, but hey, I'm sort of a visiting fudgie these days, so WTF?!?
I'm old enough that I can smell a troll from quite a ways - and I don't. Just someone that can't help but be a bit pissy. feh.
I learned long ago that there are some peeps that see life as a 'glass half full'. I pity them the negativity. You and I would go out and shoot ourselves before we slid in to that morass. Hell, I live 40 minutes from Flint.
The rule that I started imposing upon meetings and groups later in my professional life was simple. If you are going to say something will not work, you WILL offer a solution that you feel will work. Otherwise, STF up.
Always seemed to either work or streamline meetings.
The rule that I started imposing upon meetings and groups later in my professional life was simple. If you are going to say something will not work, you WILL offer a solution that you feel will work. Otherwise, STF up.
If someone saw you walking off a cliff and didn't feel that would work but didn't have a solution, I guess they would have to STF up.
Fun times ...
In my working career, I encouraged people to advise me if they saw something wrong; even if they didn't have a solution. I saw those people as my extra eyes and ears ... I took care of them as I took care of my own health.
Hell, all of this primary/caucus and related should be skipped. All who want to be president of this country, and meeting some minimum requirements could be selected as with the lottery or a coin toss is cool, too.
The real downside is the lose of hot money moving through the economy during this political rain dance period prior to the "election".
Comments
When has that 'demand side' economics worked in the past?
FYI you may actually have to make a definitive statement to answer that question.
And take into account "When infrastructure was being built in the '30s it was a labor intensive project in a closed economic (non free trade, non international) system. That is not the case today at all. Before the stimulus package was voted upon, some one had the bold ideas to make it a requirement that the $ had to go to US companies - China and other countries shot that down. " And you may want to take into consideration the velocity of money in why 'demand side' is an old idea that doesn't work.
Thanks.
In the past - the closed system - $1 of gov't spending on 'demand economics' i.e. public works, stayed in the country and would flow through the US economy several times e.g. 7-8 times - e.g. spend $1 trillion dollars and 7 trillion of 'demand' is created over time.
Now a percentage of that initial $1 goes out of the country and a percentage of the velocity of money also goes outside the USA.
E.g. spend $1trillion - 500m goes to China. 500m flows in USA but those people buy Chinese goods. It look like this in the USA if you assume velocity is 7
500 m
400
300
200
100
75
50
1,625 T
This is another reason why K theory doesn't work in today's world.
Also, since foreigners own the USA debt - the interest on the debt on the initial $1T is flowing outside the USA and can't even be taxed.
Another reason why K theory doesn't work in today's world.
But, K theory is a favorite of the pseudo intellectuals who don't understand economics.
I agree to a certain extent with the stimulus leakage from globalization more so than Krugmans of this world will admit to. As it turns out my only letter ever published by the Economist has been to point out the folly of their globalization at all costs (they are the biggest cheerleaders) when capital flow has no borders but labor flow does.
The idea of targeting spending only to US companies is not practical because it is very difficult to isolate US only companies. Money is fungible, so companies can take the money for domestic work and move the equivalent to foreign operations directly or via subsidiaries. Spending will always result in too many pork barrel projects so not a good idea. On the other hand broad and blanket untargeted tax cuts only concentrates wealth without sufficient stimulation.
But that is the structure we have got and it is not going to change any time soon. So where I differ from you is to reject collapsism/fatalism because in my line of work naysayers are the ones that create opportunities and wealth in the start up world every day (because they all land up in middle management of large companies and bring the companies down to a crawling halt saying nothing can be done which lets the can-do startups come out with solutions to disrupt the big guys). But it is not as easy to disrupt the political ideologies and needs a little bit of generational change to get rid of the hubris that has built up in our political system.
There are a large number of proposals within the CEO forums, advisory councils to the politicians, etc with much more out of the box thinking than the current cut taxes vs spend money debate. Ironically, most politicians on either side are smart enough to recognize that and in private willing to admit that it is not something that they can sell to their base in the current climate or say that they cannot support it when the other team is in power but will be willing to look at when they get the power/majority, etc. So the proposals remain as proposals in private communications and presentations for now.
One proposal out there that I am inclined towards which recognizes creating higher paid domestic job is the key (which everyone agrees to), is a tax based incentivization to do so. Nothing radical and something that already exists. For example, states compete with each other to steal businesses away from each other via large tax incentives. The proposal is based on the same idea but doing so from other countries, a sort of reverse-Irish so to speak. The tax incentive is tied tightly to domestic employment creation, so the revenue that passes through to employees isn't taxed at all at the corporation level but also provides tax credits but is recovered by the Govt as higher income taxes (relative to corporate taxe credits provided).
Foreign revenues can also be repatriated tax free as long as they can be offset via tax credits for domestic employment. This is available to US companies as well so there is no favor to any country or company. These can be anything from infrastructure companies to high tech to private education. The idea is to make the tax treatment address the imbalance in pay between countries (not entirely but sufficiently to make it worthwhile) while companies benefit from exposure to domestic market and the stability of the country and currency. Import tariffs may not be required at all to further incentivize.
Car companies have already done this to locate plants in the US based on state and municipal incentives. But needs to be incorporated into a national policy.
This is an idea that is not strange to right wing politicians and makes much sense to them BUT the US chamber of Commerce and the finanacial industry lobbying will not support it because they want corporate taxes cut for everybody whether they create employment or not or outsource it because they are only looking at return on capital not whether something is good or bad for the country in the long run. And the hypocrisy of many of their member industries does not allow for foreign companies to come and compete at least not facilitated by the US Govt if they can help it. Right wing politicians simply do not have the courage to fight that in the current climate.
The proposal is also received well in left wing political groups as it helps labor but resisted strongly by the lobbies that benefit from domestic spending and I suspect Krugman would be screaming his head off because it doesn't do the level of spending he wants. The many groups that want direct handouts will make the narrative look bad - Govt giving tax breaks to foreign governments while the poor in this country are ignored, etc. It will be cast as another failed trickle down policy. The left does not have the courage to take that on.
Both parties are afraid of the optics of bringing foreign companies to the US with tax incentives as a national policy even though it seems perfectly acceptable at the state or municipal levels.
It is a bit more complicated than the above in terms of incentives in land and tax deferrals for a limited time to set up the company but that is the gist of it. It requires, I think, a generational change in politics with the millenial generation getting into politics who are less xenophobic culturally and have grown up with a deep suspicion of the financial industry and the power of lobbies to change. So, I don't expect any miracles overnight.
As much as millenials are scorned by the older generation, I am encouraged by the optimistic and can do attitudes that I see in so many of them.
We will just have to see how it evolves. Like the financial markets it is difficult to predict the future but good things do happen longer term. Human beings are wired for adaptation and survival when faced with challenges and the US more than any other country encourages that.
1. The age of outburst (or pioneers).
2. The age of conquests.
3. The age of commerce.
4. The age of affluence.
5. The age of intellect.
6. The age of decadence.
7. The age of decline and collapse.
You should temper your hope and economic theory with history and Shakespheare.
https://www.poets.org/poetsorg/poem/you-it-act-ii-scene-vii-all-worlds-stage
Ultimately, there is no question what will happen. The question is where is the USA in its life cycle.
About a third; 2/3 is money we owe ourselves.
As for Keynesian efficacies, again study:
http://www.bloomberg.com/bw/articles/2014-10-30/why-john-maynard-keyness-theories-can-fix-the-world-economy
Goes to show less/more isn't correlated with clarity. Which points to the false dichotomy (google this fallacy) in the last paragraph.
But then self-professed clarity is usually a confirming sign of self-reinforcing delusion, a condition that I am totally unprepared to have a discourse with and so would be at a serious disadvantage. Hence I must excuse myself from this thread for more productive use of my time.
Good to hear from you. Can we get Obama to appoint an Emergency Governor of Michigan?
I'm so outraged, it's hard to think. Snyder's talking about the buck stops with him while throwing civil servants under the bus. AG is refusing to represent a few of the DEQ folks as a possible conflict because he must represent both the Gov and the state.
Issue with the suit is Gross Negligence. State and local gov'ts are exempt from suit UNLESS gross negligence has occurred. I don't trust the AG (religinazi creep) but I'm actually starting to trust the SCOM.
take care,
peace,
rono
Howdy there. FYI, I've flagged Dex's comments a couple of times recently as being juvenile, boorish, and unnecessarily personally argumentative. Of course on a public forum, especially one as lightly moderated as MFO, it's not uncommon to attract the occasional troll. Usually they are so obnoxious that the moderators eventually discourage their continued participation in the forum.
Dex, however, is a unique and difficult case because he is quite capable of originating reasonable and interesting topics. Unfortunately, he automatically reverts to his juvenile attack mode whenever anyone dares to disagree with him in the slightest manner, which makes continued conversation impossible. After a number of exchanges with him I realized that I was being dragged down to his schoolyard level, so I've resolved just to simply ignore him. There's no sense in continuing to feed his obvious insatiable need for applause and approbation.
Regards- OJ
Geez, you peeps that live in The City, are soooooo sensitive.
Yeah, I noticed it too, but hey, I'm sort of a visiting fudgie these days, so WTF?!?
I'm old enough that I can smell a troll from quite a ways - and I don't. Just someone that can't help but be a bit pissy. feh.
I learned long ago that there are some peeps that see life as a 'glass half full'. I pity them the negativity. You and I would go out and shoot ourselves before we slid in to that morass. Hell, I live 40 minutes from Flint.
The rule that I started imposing upon meetings and groups later in my professional life was simple. If you are going to say something will not work, you WILL offer a solution that you feel will work. Otherwise, STF up.
Always seemed to either work or streamline meetings.
Good to hear from you,
peace,
rono
If you don't like a poster's style move on.
According to Colbert, in 6 (tied) precincts a coin toss selected the delegate(s). And Hillary won all 6 coin tosses. How's that for uncanny good luck?
Hell, all of this primary/caucus and related should be skipped.
All who want to be president of this country, and meeting some minimum requirements could be selected as with the lottery or a coin toss is cool, too.
The real downside is the lose of hot money moving through the economy during this political rain dance period prior to the "election".